Exhibit 10.7
NATIONAL INFORMATION CONSORTIUM, INC.
KEY EMPLOYEE AGREEMENT
FOR
XXXXX X. XXXXXXXXX
THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into as of the 24 day
of July 1998, by and between XXXXX X. XXXXXXXXX ("Executive") and NATIONAL
INFORMATION CONSORTIUM, INC. a Delaware corporation (the "Company").
WHEREAS, the Company desires to employ Executive to provide personal
services to the Company and to the Company's subsidiaries, and desires to
provide Executive with certain compensation and benefits in return for his
services; and
WHEREAS, Executive desires to be employed by the Company and provide
personal services to the Company in return for certain compensation and
benefits;
NOW, THEREFORE the parties hereto agree as follows:
1. EMPLOYMENT BY THE COMPANY.
1.1 Subject to terms set forth herein, the Company or a subsidiary
of the Company agrees to employ Executive in the position of Subsidiary
President and Executive hereby accepts such employment effective as of the
date first written above. During the term of his employment with the Company,
Executive will devote his best efforts and substantially all of his business
time and attention (except for vacation periods and reasonable periods of
illness or other incapacities permitted by the Company's general employment
policies) to the business of the Company.
1.2 Executive will serve in an executive capacity and shall
perform such duties as are customarily associated with his then current
title, consistent with the Bylaws of the Company and as required by the
Company's Board of Directors (the "Board").
1.3 The employment relationship between the parties shall also be
governed by the general employment policies and practices of the Company,
including those relating to protection of confidential information and
assignment of inventions, except that when the terms of this Agreement differ
from or are in conflict with the Company's general employment policies or
practices, this Agreement shall control.
2. COMPENSATION.
2.1 SALARY. Executive shall receive for services to be rendered
hereunder an annualized base salary of $125,000, payable in equal
installments (prorated for portions of a pay period) on the Company's regular
pay days and the Company will
1
withhold from such compensation all applicable federal and state income,
social security and disability and other taxes as required by applicable laws.
2.2 STANDARD COMPANY BENEFITS. Executive shall be entitled to all
rights and benefits for which he is eligible under the terms and conditions
of the standard Company benefits and compensation practices which may be in
effect from time to time and provided by the Company to its employees
generally.
3. PROPRIETARY INFORMATION OBLIGATIONS.
3.1 AGREEMENT. Executive agrees to execute and abide by the
Proprietary Information and Inventions Agreement attached hereto as EXHIBIT A
(the "Proprietary Information Agreement").
4. OUTSIDE ACTIVITIES.
4.1 Except with the prior written consent of the Company's Board
of Directors, Executive will not during the term of this Agreement undertake
or engage in any other employment, occupation or business enterprise, other
than ones in which Executive is a passive investor. Executive may engage in
civic and not-for-profit activities so long as such activities do not
materially interfere with the performance of his duties hereunder.
4.2 Except as permitted my Section 4.3, Executive agrees not to
acquire, assume or participate in, directly, any position, investment or
interest known by him to be adverse or antagonistic to the Company, its
business or prospects, financial or otherwise.
4.3 During the term of his employment by the Company, except on
behalf of the Company, Executive will not directly or indirectly, whether as
an officer, director, stockholder, partner, proprietor, associate,
representative, consultant, or in any capacity whatsoever engage in, become
financially interested in, be employed by or have any business connection
with any other person, corporation, firm, partnership or other entity
whatsoever which were known by him to compete directly with the Company,
throughout the world, in any line of business engaged in (or planned to be
engaged in) by the Company; provided, however, that anything above to the
contrary notwithstanding, he may own, as a passive investor, shares of a
publicly-held corporation that is competitive with the Company, if such
shares are actively traded on an established national securities market, so
long as the number of shares of such corporation's capital stock that are
owned beneficially (directly or indirectly) by Executive shall not in the
aggregate constitute more than 5% of the outstanding voting stock of such
corporation.
5. TERMINATION OF EMPLOYMENT.
5.1 TERMINATION WITHOUT CAUSE.
(a) The Company shall have the right to terminate Executive's
employment with the Company at any time without cause.
2
(b) In the event Executive's employment is terminated without
cause before July 1, 2001, the Company shall pay Executive one year's base
compensation in equal monthly payments on the first day of the month for each
of the twelve months following such termination; PROVIDED HOWEVER that if
Executive is terminated without cause during the final twelve months of
Executive's base compensation for the remaining number of months until the
expiration of that Employment Agreement.
(c) In the event Executive's employment is terminated without
cause on or after July 1, 2001, he will not be entitled to severance pay, pay
in lieu of notice or any other such compensation, except as provided in the
Company's Severance Benefit Plan, if any, in effect on the termination date.
5.2 TERMINATION FOR CAUSE.
(a) The Company shall have the right to terminate Executive's
employment with the Company at any time for cause. Written notification of
termination and specific cause of termination shall be provided to the
Executive at the time of termination.
(b) "Cause" for termination shall mean: (i) indictment or
conviction of any felony or of any crime involving dishonesty; (ii) willful
participation in any fraud against the Company; (iii) breach of Executive's
duties to the Company, including persistent unsatisfactory performance of job
duties; (iv) intentional damage to any property of the Company; or (v)
conduct by Executive which in the good faith and reasonable determination of
the Board demonstrates gross unfitness to serve. With respect to clause
(iii) above, Executive shall be given written notice of such unsatisfactory
performance and 30 days from the date of such notice to cure the causes set
forth therein.
(c) In the event Executive's employment is terminated at any
time with cause, the executive will not be entitled to severance pay, pay in
lieu of notice or any other such compensation; PROVIDED, HOWEVER, Executive
is entitled and shall receive all compensation earned prior to and including
the date of termination.
5.3 VOLUNTARY OR MUTUAL TERMINATION.
(a) Executive may voluntarily terminate his employment with
the Company in writing at any time, after which no further compensation will
be paid to Executive.
(b) In the event Executive voluntarily terminates his
employment, he will not be entitled to severance pay, pay in lieu of notice
or any other such compensation; PROVIDED, HOWEVER, that Executive shall
receive all compensation earned prior to and including the date of
termination.
3
6. NON-INTERFERENCE; NON-COMPETITION.
(a) While employed by the Company, and for three (3) years
immediately following the Termination Date, Executive agrees not to interfere
with the business of the Company by:
(i) soliciting, attempting to solicit, inducing, or
otherwise causing any employee of the Company to terminate his or her
employment in order to become an employee, consultant or independent
contractor to or for any competitor of the Company; or
(ii) directly or indirectly soliciting the business of
any customer of the Company which at the time of termination or one year
immediately prior thereto was listed on the Company's customer list.
(b) Executive agrees to execute and abide by the
Non-Competition Agreement attached hereto as EXHIBIT B.
7. GENERAL PROVISION.
7.1 NOTICES. Any notices provided hereunder must be in writing
and shall be deemed effective upon the earlier of personal delivery
(including personal delivery by telex) or the third day after mailing by
first class mail, to the Company at its primary office location and to
Executive at his address as listed on the Company payroll.
7.2 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
invalid, illegal or unenforceable in any respect under any applicable law or
rule in any jurisdiction, such invalidity, illegality or unenforceability
will not affect any other provision or any other jurisdiction, but this
Agreement will be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provisions had never been contained
herein.
7.3 WAIVER. If either party should waive any breach of any
provisions of this Agreement, he or it shall not thereby be deemed to have
waived any preceding or succeeding breach of the same or any other provision
of this Agreement.
7.4 COMPLETE AGREEMENT. This Agreement and its Exhibits,
constitute the entire agreement between Executive and the Company and it is
the complete, final, and exclusive embodiment of their agreement with regard
to this subject matter. It is entered into without reliance on any promise or
representation other than those expressly contained herein, and it cannot be
modified or amended except in a writing signed by Executive and an officer of
the Company.
7.5 COUNTERPARTS. This Agreement may be executed in separate
counterparts, any one of which need not contain signatures of more than one
party, but all of which taken together will constitute one and the same
Agreement.
4
7.6 HEADINGS. The headings of the sections hereof are inserted
for convenience only and shall not be deemed to constitute a part hereof nor
to affect the meaning thereof.
7.7 SUCCESSORS AND ASSIGNS. This Agreement is intended to bind
and inure to the benefit of and be enforceable by Executive and the Company,
and their respective successors, assigns, heirs, executors and
administrators, except that Executive may not assign any of his duties
hereunder and he may not assign any of his rights hereunder without the
written consent of the Company, which shall not be withheld unreasonably.
7.8 ATTORNEY FEES. If either party hereto brings any action to
enforce his or its rights hereunder, the prevailing party in any such action
shall be entitled to recover his or its reasonable attorneys' fees and costs
incurred in connection with such action.
7.9 CHOICE OF LAW. All questions concerning the construction,
validity and interpretation of this Agreement will be governed by the law of
the State of Kansas.
IN WITNESS WHEREOF, the parties have executed this Key Employee
Agreement on the day and year first above written.
NATIONAL INFORMATION
CONSORTIUM, INC.
By:/s/ Xxxx Xxxxxx
--------------------
Name:Xxxx Xxxxxx
------------------
Title:President
---------
EXECUTIVE:
/s/ Xxxxx X. Xxxxxxxxx
------------------------
Name:Xxxxx X. Xxxxxxxxx
-------------------
5
